India PM rejects calls for minister's exit over 'Coalgate'

India's premier dismissed Saturday calls for the resignation of the federal law minister who vetted a police report on alleged graft in awarding coal blocks before it was submitted to the Supreme Court.

Prime Minister Manmohan Singh told reporters in New Delhi there is "no question of the law minister resigning" and declined further comment, saying the matter was "in court and subjudice".

Singh's statements came a day after the Central Bureau of Investigation (CBI) said Law Minister Ashwani Kumar and officials of the prime minister's office and coal ministry saw the police report before it went to the Supreme Court.

The disclosure by the federal investigation agency has mired the already scandal-tainted Congress-led government in new controversy and sparked opposition demands for the resignations of both Kumar and Singh.

CBI director Ranjit Sinha said in an affidavit a "status" report on the agency's probe into the coal allotments was "shared" with Kumar and other government officials "as desired by them" before being given to Supreme Court judges.

The CBI's report on what India's media has dubbed "Coalgate" is still to be made public.

But earlier in the week, a parliamentary panel said the coal blocks allocated between 1993 and 2010 were awarded in a "most non-transparent" manner to a "few fortunates" through the "abuse of power".

The panel urged the scrapping of the "illegal" allocations of the mines, creating fresh uncertainty in the energy sector which is plagued by shortages as India's growing economy consumes ever larger amounts of fuel.

Singh, 80, in addition to his job as premier, served as coal minister from 2004-2009 and the opposition has blamed him for many of the allotment irregularities.

The allocations between 1993 and 2010 caused huge losses to the exchequer, the parliamentary committee said, although it said it was unable to estimate the sum lost as the coal ministry could give no information about mines' value.

The panel's findings came after the national auditor last year said the Congress government gave away $33 billion in windfall benefits to firms to extract coal.

Following the auditor's report, the government ordered the CBI to probe the allocations and it is the agency's investigation report which is at the heart of the latest political row.

CBI in its affidavit did not say whether any changes were made to the report at the behest of the government.

"I have done no wrong, the truth will prevail," Kumar said Friday, insisting it was his job as the government's law officer to provide legal inputs.

But the opposition said the minister had lost "the moral right" to remain in office and that it had tried to interfere with the agency's independence.

Now, eyes are on the Supreme Court's hearing next Tuesday when it will respond to the CBI's disclosures.